Estate of Briggs v. Cariveau
| Decision Date | 19 September 2018 |
| Docket Number | A151767 |
| Court | California Court of Appeals Court of Appeals |
| Parties | Estate of MARLIN GENE BRIGGS, Deceased. GREGORY HOBBS, Objector and Appellant, v. TOM CARIVEAU, as Administrator, etc., Petitioner and Respondent. |
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.
(Lake County Super. Ct. No. PR501829)
Lake County resident Marlin Briggs died, with his primary assets consisting of several parcels of real property, two of which were in Florida. Following his appointment as special administrator, respondent Tom Cariveau hired a Florida law firm to open an ancillary probate proceeding there, a proceeding that appellant Gregory Hobbs had for months insisted on—indeed going so far as to file a petition seeking such appointment. And Cariveau paid the firm for its services, which were of substantial benefit to the estate.
Cariveau filed a final accounting, to which Hobbs filed objections. The Lake County Probate Court held a two-day hearing, at the conclusion of which it approved the accounting, finding among other things that it "was necessary and proper" for Cariveau to retain Florida counsel. Hobbs appeals, asserting primarily that the payments to Florida counsel were made without court order, and thus Cariveau should be surcharged for such payments. Hobbs also objects to a $181 payment made to the probate referee, argues that Cariveau should be surcharged $83 for three months of lost interest for not investing estate funds in an interest-bearing account, and $4.62 for a failure to timely pay real estate taxes. Finally Hobbs appeals a $2,715 sanction imposed on him for his failure to respond to special interrogatories. We affirm.
Marlin Briggs, a resident of Lake County, died on April 7, 2014. He lived with his partner Kenneth Hobbs. In May 2014 Jon Briggs, Marlin's son, filed a petition for probate, and in June Kenneth Hobbs filed a competing petition for probate of will and letters testamentary. In July two of Marlin's daughters filed a will contest against Kenneth Hobbs, which will contest was settled in January 2016, and Marlin's will dated April 2014 was admitted to probate. Under that will, Kenneth Hobbs, Marlin's partner, was to receive all of Briggs's personal property. The residue was to be divided equally among five people: Marlin's four children (Jon Briggs, Kara Van Den Berg, Lora Sammon, and Lisa Briggs Valdez) and appellant Gregory Hobbs (hereinafter Hobbs), brother of Marlin's partner Kenneth. In short, appellant was to receive one-fifth of the residue.
Briggs's primary assets were six parcels of real property, four of which were in Lake County, two in Tampa, Florida. The Lake County properties were in Clearlake Oaks, on East Highway 20 and New Long Valley Road. The Tampa properties were single-family residences on North B Street and North Tampania Avenue.
On August 27, 2014 the public administrator was appointed the special administrator of Briggs's estate, and letters were issued. And at some point the public administrator ordered appraisals of the Florida properties. The public administrator thereafter determined that the estate had become too complex—and apparently too contentious—for the public administrator to handle, and he approached Cariveau, of Lakeport, a professional fiduciary for some 35 years, to inquire whether he would consider becoming involved as special administrator. Cariveau agreed, and on April 14,2015 the court appointed Cariveau and issued letters of special administration to him. After his appointment Cariveau retained Mary Amodio, a Lake County attorney, to assist him as probate counsel. And in mid-July 2015 Cariveau received some funds from the public administrator, which he deposited into a checking account he had opened for the estate. The source of these funds was three $10,000 loans that three of Briggs's children had made to the public administrator to pay expenses, as Briggs's estate included virtually no liquid assets.
Meanwhile, within weeks of his appointment, Cariveau received the first of many letters from Hobbs's attorney Raymond Sandelman concerning the Florida properties. This was a letter of May 20, 2015 to attorney Amodio in which Sandelman demanded that Cariveau open an ancillary probate proceeding in Florida. As Sandelman would come to admit at the hearing, he intended his letter to convey to Cariveau that he had "a duty to secure the appointment of an ancillary Florida administrator."
Less than a month later, on June 17, Sandelman sent another letter to Amodio in which he reminded "Cariveau to take action to ensure that an ancillary administrator in Florida administered the Florida property properly." This was followed up thirteen days later by another letter in which Sandelman asserted that "Cariveau would have breached his fiduciary duty by not having an ancillary administrator appointed to administer the Florida assets." Seven days later, on July 7, Sandelman sent another letter to Amodio, admonishing that: "Prompt appointment of an ancillary administrator is needed so that such personal representative can collect all of the rent income since the decedent's death." And on July 27, Sandelman sent yet another letter to Amodio, this time threatening to seek a surcharge against Cariveau if he did not cause an ancillary probate matter to be opened in Florida to deal with the impending foreclosures. As Sandelman put it:
On October 14, Hobbs, through Sandelman, filed a petition in Lake County Probate Court in which he sought among other relief an order directing Cariveau to open an ancillary probate in Florida and address the foreclosure litigation. The petition asserted that Cariveau had "failed and refused to secure an ancillary administrator in the State of Florida," and also that Cariveau had a duty to make sure that the "ancillary administrator administers the out-of-state property properly." Finally, and as pertinent here, the petition asserted—and correctly—that Cariveau would not need prior court approval to expend necessary funds to do so, stating that: "where the special administrator expends estate funds in connection with the preservation of the out-of-state assets without prior court approval, the court is required to exercise its discretion in determining whether or not to ratify the expenditure; and it would be error for the court to refuse to exercise such discretion on the ground the special administrator has no duty at all in connection with the out-of-state property." (Italics added.)
That petition, it would develop, was essentially moot, as Cariveau had already acted. Two days before, on October 12, Cariveau had retained the Florida law firm of Phelps Dunbar LLP, a firm that had experience with both real estate and probate issues. Cariveau retained Phelps Dunbar for two purposes: (1) to appoint a "curator" (the Florida equivalent of an administrator), and (2) to handle the legal work necessary to an ancillary probate proceeding in Florida. As Cariveau would come to testify at the hearing, he contacted Phelps Dunbar because he and Amodio wanted to obtain as much information as they could regarding the "ramifications of having an ancillary probate in Florida," ultimately to determine that the properties in Florida could create liability for the California estate. Although Cariveau reached that conclusion independently, it is to be noted that the conclusion was consistent with what Hobbs and Sandelman had been claiming in the barrage of Sandelman's correspondence to Amodio described above. In short, Cariveau decided to hire Florida counsel to ameliorate potential liability caused by the foreclosure proceedings in that state.
Phelps Dunbar located Julie Goddard to serve as curator of the Florida ancillary estate. Cariveau paid her a $1,500 flat fee for her services, and provided a $1,000 depositfor maintenance expenses for the Florida property, both amounts paid from the California estate.
Phelps Dunbar informed Cariveau that Florida was a recourse state, meaning "that the heirs of the estate in California could be at risk for satisfying a judgment" resulting from foreclosure proceedings in Florida. Once Cariveau learned that, he determined that he "simply could not risk that kind of loss to the heirs," and he instructed Phelps Dunbar to contact the entities handling the foreclosures and negotiate assurances from them that they would not seek any deficiency judgments against the California estate or its beneficiaries. Indeed, Cariveau believed "it would have been malpractice" for him not to have done so.
Over the next several months, Goddard and Phelps Dunbar negotiated with creditors in Florida to resolve the foreclosure actions and secure agreements from the lenders that they would not seek deficiency judgments. And they did—successfully. On April 13, 2016, Goddard sold the North B Street property via short sale for $44,000, of which amount Goddard paid $39,742.25 to the lender. As part of the short sale agreement, Goddard and Phelps Dunbar obtained a deficiency release from the lender totaling $105,524.98, representing the difference between the total obligation of $145,267.23 owed and the $39,742.25 paid to the lender. Similarly, on June 24, Goddard sold the North Tampania property via short sale for $45,000, of which Goddard...
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